An aging and indebted world spending less, and a soaring greenback have taken both boots to multi-national sales and earnings trends since 2011. While stock prices always recognize such realities eventually, this cycle central banks have managed to inspire an unusually long period of willful blindness among participants.

Down just 11% since last July, the S&P 500 has levitated in a world of HFT dreaming, even as other global markets have increasingly hit the skids. Far from getting off easy however, the S&P 500 now has the distinction of being one of the most precariously perched markets in the world today. This chart of sales growth (in blue) versus the price of the S&P (in black) since 2000 paints the picture well. See: "Earnings take a dark turn as profits warnings, sales misses mount".

Click to enlargeAnd of course, as shown next below, all the borrowing/buy back tricks the past 4 years have only made the overshoot in share prices (black) versus earnings growth (in blue) even worse.